Joy Global Inc. (JOY-N)

They are in a duopoly with CAT-N. The servicing of the equipment is an important part of the business. They have been aggressively buying back shares while they are cheap. You have to buy this kind of company when the industry is not in great shape.

(A Top Pick April 30/13. Up 9.98%.) This is a very cyclical company. They are probably the best in the world at what they do. They make equipment for global coal. He sees 40%-50% upside over the next 3 years.

(Top Pick Nov 7/12, Down 10.47%) Smaller version of CAT-N. A stock that does extremely well in the last month of the year. 4% in November, 7% in December and he got out in January. Not sure if he will do it again this year. Infrastructure story, a consumption story.

In a duopoly business of companies that manufacture mining equipment, especially in the coal industry. Coal industry is lousy in North America but this is a big global business and will be a huge beneficiary as China and India have a huge number of coal generated electricity plants coming on stream. Not expensive at 9 or 10 times earnings. Earnings will be down somewhat this year, but not in a huge way. Generating a lot of free cash flow and will pay down debt that they incurred from some acquisitions. Should be big dividend increases in the next few years and significant earnings growth over the cycle. Expects it to double in 3-5 years.

Not as exposed to the overseas market as Caterpillar (CAT-N). 50% North America as opposed to Caterpillar’s 65%. Also, a little bit cheaper relative to its growth rate. Trading at 9X forward earnings, which is near a decade low for them. Expects them to grow at 15%-70% annual earnings growth rate.